[Exclusive] Damages from Illegal Private Lending Snowball... 'Investigative Expertise' a Challenge for Special Judicial Police for Public Welfare

The government's decision to expand the investigative scope of the Special Judicial Police for Public Welfare Financial Crimes, set to launch next year, to include debt collection reflects its determination to enhance its ability to respond to such harmful practices. However, securing investigative expertise is considered the top priority for the introduction of special judicial police to lead to the eradication of illegal private lending.
**Illegal Private Lending Surges Daily** According to the government on the 26th, financial authorities have strengthened the scope of investigation for special judicial police for public welfare to include debt collection in addition to loans because damages from illegal private lending are on the rise and criminal methods are becoming more vicious. According to data submitted by the Financial Supervisory Service (FSS) to the office of Democratic Party lawmaker Chae Hyun-il, the number of reports of damages from illegal private lending received by the FSS in the first half of this year totaled 10,037.**Illegal Private Lending Surges Daily** According to the government on the 26th, financial authorities have strengthened the scope of investigation for special judicial police for public welfare to include debt collection in addition to loans because damages from illegal private lending are on the rise and criminal methods are becoming more vicious. According to data submitted by the Financial Supervisory Service (FSS) to the office of Democratic Party lawmaker Chae Hyun-il, the number of reports of damages from illegal private lending received by the FSS in the first half of this year totaled 10,037.
Reports of damages from illegal private lending are increasing every year. After surpassing 10,000 cases in 2022 with 10,913, the trend has been steadily increasing, reaching 13,751 in 2023, 15,397 in 2024, and 17,538 in 2025.
New types of illegal private lending designed to evade crackdowns by financial authorities are also emerging one after another. The methods are becoming more diverse, such as "gift certificate loans" that demand larger amounts of gift certificates upon repayment, or high-interest loans exceeding 150% per year secured by fake mobile phone rental contracts, followed by threats of criminal prosecution if the money is not repaid.
A more significant problem is that as low-credit borrowers are pushed out of institutional finance and driven into illegal private lending due to tightened lending regulations and the economic downturn, the likelihood of them being exposed to harm is increasing even further. 55 trillion won.
5%. **Challenge: Securing Investigative Expertise** Securing investigative expertise has emerged as an essential task for the Special Judicial Police for Public Welfare to go beyond mere launch and actually eradicate illegal private lending.
This is because even if the Special Judicial Police are launched early next year, personnel must master investigative techniques to be deployed to the field and properly crack down on the damages. The Financial Supervisory Service (FSS) is also striving to strengthen its expertise on its own ahead of the Special Judicial Police's launch.
**Illegal Private Lending Surges Daily** According to the government on the 26th, financial authorities have strengthened the scope of investigation for special judicial police for public welfare to include debt collection in addition to loans because damages from illegal private lending are on the rise and criminal methods are becoming more vicious. According to data submitted by the Financial Supervisory Service (FSS) to the office of Democratic Party lawmaker Chae Hyun-il, the number of reports of damages from illegal private lending received by the FSS in the first half of this year totaled 10,037.**Illegal Private Lending Surges Daily** According to the government on the 26th, financial authorities have strengthened the scope of investigation for special judicial police for public welfare to include debt collection in addition to loans because damages from illegal private lending are on the rise and criminal methods are becoming more vicious. According to data submitted by the Financial Supervisory Service (FSS) to the office of Democratic Party lawmaker Chae Hyun-il, the number of reports of damages from illegal private lending received by the FSS in the first half of this year totaled 10,037.
Last April, practical investigative training, covering topics such as evidence seizure and warrant application methods, was conducted for 30 to 40 employees interested in related duties. There are plans to conduct practical training regularly until the launch of the Special Judicial Police.
However, the legal community views the expansion of the Financial Supervisory Service's Special Judicial Police with concern.
A legal official pointed out, "Debt collection is generally a field where the police excel, rather than a specialized area within the financial sector," adding, "Investigating debt collection involves complex procedures, such as obtaining warrants for communications and search and seizure, so there are concerns about whether the Special Judicial Police personnel can handle it.
" He continued, "However, given the recent increase in the complexity of crimes, I believe the direction of broadly investigating related offenses and strengthening victim protection measures is correct in order to completely dismantle organized illegal private lending crimes.
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[email protected] Lee Ju-mi Lee Hwan-ju Reporter